Correlation Between Mainstay Tax and Mainstay Wmc
Can any of the company-specific risk be diversified away by investing in both Mainstay Tax and Mainstay Wmc at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Mainstay Tax and Mainstay Wmc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Tax Free and Mainstay Wmc Value, you can compare the effects of market volatilities on Mainstay Tax and Mainstay Wmc and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Mainstay Tax with a short position of Mainstay Wmc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Tax and Mainstay Wmc.
Diversification Opportunities for Mainstay Tax and Mainstay Wmc
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mainstay and Mainstay is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Tax Free and Mainstay Wmc Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Wmc Value and Mainstay Tax is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Mainstay Tax Free are associated (or correlated) with Mainstay Wmc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Wmc Value has no effect on the direction of Mainstay Tax i.e., Mainstay Tax and Mainstay Wmc go up and down completely randomly.
Pair Corralation between Mainstay Tax and Mainstay Wmc
Assuming the 90 days horizon Mainstay Tax is expected to generate 4.15 times less return on investment than Mainstay Wmc. But when comparing it to its historical volatility, Mainstay Tax Free is 2.8 times less risky than Mainstay Wmc. It trades about 0.12 of its potential returns per unit of risk. Mainstay Wmc Value is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 3,431 in Mainstay Wmc Value on August 27, 2024 and sell it today you would earn a total of 107.00 from holding Mainstay Wmc Value or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Tax Free vs. Mainstay Wmc Value
Performance |
| Timeline |
| Mainstay Tax Free |
| Mainstay Wmc Value |
Mainstay Tax and Mainstay Wmc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Tax and Mainstay Wmc
The main advantage of trading using opposite Mainstay Tax and Mainstay Wmc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Tax position performs unexpectedly, Mainstay Wmc can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Mainstay Wmc will offset losses from the drop in Mainstay Wmc's long position.| Mainstay Tax vs. Mainstay High Yield | Mainstay Tax vs. Mainstay Income Builder | Mainstay Tax vs. Mainstay Large Cap | Mainstay Tax vs. Mainstay Large Cap |
| Mainstay Wmc vs. Mainstay High Yield | Mainstay Wmc vs. Mainstay Tax Free | Mainstay Wmc vs. Mainstay Income Builder | Mainstay Wmc vs. Mainstay Large Cap |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |